PHOENIX-During the early part of 2012, it was suggested to Berkadia Commercial Mortgage LLC‘s CEO Hugh Frater that he meet with Don Hendricks, CEO and founder of Hendricks & Partners. The reason? “We’d been thinking, for a long time, about how to provide more products and services to our multifamily borrowers and clients,” Frater comments.
The end result was that both leaders met, spent some time getting to know each other and, as of Jan. 1, Berkadia Commercial’s acquisition of Hendricks & Partners became reality, with the new firm operating under the name of Hendricks-Berkadia. The leaders of both companies tell GlobeSt.com that the deal made sense, given the current commercial real estate climate and because of their own strategic plans moving forward.
“We felt, based on the timing in the marketplace going forward, that a fully integrated, full-service real estate platform was in the best interest of our clients,” notes Hendricks, who founded Hendricks & Partners in 1995. “We were excited we could hook up with Berkadia and to merge into a fully integrated platform we feel will offer more services and value to not only our owners, but advisors and producers throughout the country.”
Frater, in the meantime, was figuring out the best way to move forward. “One of the key decisions involves ‘should I finance or completely recapitalize and sell?’” he says. “The ability to advices a client on that full array of recapitalization options, we felt, was the right way to approach the business.” That issue drove Frater to find likely others with which to partner, and when he came across Hendricks & Partners, “we found a marriage made in heaven with Don and his team,” he comments. “Combining our experience on debt placement with Don’s expertise on multifamily research and brokerage means we have a much better product set to deliver to our customers.”
Even better news for all concerned is that the acquisition merges complementary functions, as opposed to generating overlapping positions. Frater was adamant that the Hendricks brand still remain in play, given its longevity. Hendricks-Berkadia’s headquarters will remain in Phoenix. No one will lose their jobs. In fact, expansion is in the works for the brokerage side. Hendricks was somewhat coy when asked about where and when these expansions would occur, however. “The plan, both short-term and long-term for Hendricks-Berkadia, is to expand the company nationwide and to cover every area with an expanded, full-service multifamily team of both investment sales and mortgage banking advisors working from an integrated platform,” he notes. Hendricks-Berkadia offices are currently located along the West Coast and Intermountain West, along with the southwest, southeast and Midwest; Hendricks also points out that he’s looking forward to expanding institutional apartment services.
Both Frater and Hendricks envision the build-out of both the capital and brokerage platforms. Hendricks points out that the acquisition means the new entity will be in a position to provide a variety of multifamily products and services to institutional and private owners that might require options when it comes to multifamily product and capital. And Frater acknowledges he’s looking forward to pursuing acquisitions along with expanding origination capacity and the servicing portfolio.
“This is a long-term commitment for Don and us,” Frater adds. “We have great shareholders and a long-term view of the opportunities and the business. Bringing Don to the team with the long-term view of opportunities will be a great thing for both of us, and we’re very excited about it.”